I need some legal advice

[math teacher]

Please do not quote-I will delete later for privacy.

 

A little backstory: My mother in law is having an issue with her sister's estate that may ultimately affect dh and I. Mil's sister passed away  earlier this year. Husband was several years older, so assumption was that he would pass first. She handled investments and apparently the will (will kit-don't know how good those are.) Sister named MIL as a beneficiary to some stocks and Sister's husband now wants MIL to sign them over to him. MIL received a certified letter yesterday from his attorney that stated she had 10 business days to sign the paperwork, or a lawsuit would be brought and she would have to pay costs of upwards of $300 per hour in fees. This is in Arkansas. 

Does he really have a suit? Is this a gray area where the law will side with him, or is this a black and white case that MIL will retain these stocks? 

 

[Clemsondana]

I'm not a lawyer, but we just made wills last year.  We used a lawyer, but it was mostly fill-in-the-blank so I could see how it could be done at home for people with simple plans like ours.  We've also just talked my in-laws through rewriting their wills.  For ours and theirs, they went something like 'In the event of my death, everything goes to spouse.  If spouse is dead, it then goes to (kids, grandkids, siblings) to be divided (evenly or in specified proportions)'.  So, even if the assumption is that husband would predecease SIL (as is the case for my in-laws, where FIL is older and has more health problems) I'd assume that the will is set up how she intended it to be because it's easy enough to list 'if they die then X is next in line' or 'Thing X goes to spouse and Thing Y goes to sibling'...and also because it would be a little strange to write a will assuming that people die in an expected order since car accidents and aneurisms and all sorts of unexpected things can happen.  

[Catwoman]

If the situation is as you explain it, the husband has no claim. The will specifically bequeathed the stocks to your MIL. The husband is being a bully and hoping to scare your MIL into signing the stocks over to him, but the fact is, the stocks are legally hers. There is no grey area here. 

Edited July 9, 2022 by Catwoman
typo

[Carol in Cal.]

What basis in law did the letter cite?

I’m no lawyer, but from what I have heard, usually beneficiary designations are final at death, except for some retirement accounts in which the spouse must get 50% of the money regardless of what the beneficiary form says.  These stocks don’t sound like they are in that kind of account.  Just being an IRA does not make the account into one like that.

https://www.investopedia.com/ask/answers/05/inheritira.asp

Arkansas is not a community property state so even if she earned the money during the marriage spouse would not necessarily have a claim on it, I don’t think.

BUT, again, I’m not a lawyer.  She needs to talk with a lawyer right away about this.  Probably she will find out that the letter is a bluff, but she does need to check to make sure.

[Loowit]

I would think the husband has no claim and is just trying to scare her into signing it over.  I am not a lawyer, but I would advise her to talk to one right away to find out if the husband has a legitimate claim or is just trying to bully/bluff.

[Tiberia]

If you know the stock broker company (if it's something like Fidelity or Vanguard) she could go straight to them and make the claim by providing a death certificate. If they have her listed as the beneficiary, the broker will deal with her directly. Also, most states require that the will be filed and it becomes public record. She/you might want to request a copy just to see what's in there. You should be able to figure this out online for the most part. Usually, a beneficiary designation trumps a will for accounts like that. I'd gather as much info as you can, and then decide if a lawyer is needed. Good luck. Sorry you're all having to deal with this.

ETA: Most lawyers will do a free initial consultation, so you could check it out that way first and see what the lawyer thinks.

Edited July 9, 2022 by Tiberia

[sassenach]

I don’t know about the legal claim but maybe she should think through whether she really wants to fight for them. If they were marital assets only willed to her because the sister thought she would outlive the husband, shouldn’t they be given back to the husband? 

[fraidycat]

I'm not a lawyer, and have never even played one on t.v. Some thoughts that I have:

1) His lawyer can threaten her with legal fees, but it would be up to a judge whether she would be responsible because HE is the one who signed the contract for payment with his lawyer.

2) Is it "some" stocks, or all of the stocks? If it is only a portion of their total assets he has less standing to win if he were to contest.

3) Have her check directly with the brokerage firm to see if she is the named beneficiary directly with them. Most financial institutions have named beneficiary that supercedes any secondary paperwork such as wills.

4) Were there any other beneficiaries named in her sister's will outside of your MIL and the husband, and if so, is he threatening all of them as well. If so, this may require group effort.

5) It is probably worth it for your MIL to consult with her own legal counsel, one who specializes in wills and estates, with a copy of whatever paperwork she has naming her as beneficiary in hand.

I'm sorry for your family's loss and all the added stress. Hugs.

[Tiberia]

2 minutes ago, sassenach said:

I don’t know about the legal claim but maybe she should think through whether she really wants to fight for them. If they were marital assets only willed to her because the sister thought she would outlive the husband, shouldn’t they be given back to the husband? 

This should be clearly outlined in the will if it is true. If it is not outlined in the will, they can only go on the actual will and the beneficiary designations. Now that sister is gone, there's no use in trying to guess what she actually wanted. They're stuck with what's in writing, not their interpretation of intent. 

[Scarlett]

2 hours ago, math teacher said:

Please do not quote-I will delete later for privacy.

 

 

Letters from attorneys are generally scare tactics IMO.  
 

I would not sign it over just because of a threat.  
 

I am not an attorney…..but I seems to me it matters if it is marital property or not.  But even if it is the sister should have been able to will at least her half to her sister.  
 

 

[bensonduck]

She needs to consult an lawyer. The surviving spouse might be able to elect against the will under certain circumstances and take a portion of the assets. 

[math teacher]

1 hour ago, fraidycat said:

I'm not a lawyer, and have never even played one on t.v. Some thoughts that I have:

1) His lawyer can threaten her with legal fees, but it would be up to a judge whether she would be responsible because HE is the one who signed the contract for payment with his lawyer.

2) Is it "some" stocks, or all of the stocks? If it is only a portion of their total assets he has less standing to win if he were to contest.

3) Have her check directly with the brokerage firm to see if she is the named beneficiary directly with them. Most financial institutions have named beneficiary that supercedes any secondary paperwork such as wills.

4) Were there any other beneficiaries named in her sister's will outside of your MIL and the husband, and if so, is he threatening all of them as well. If so, this may require group effort.

5) It is probably worth it for your MIL to consult with her own legal counsel, one who specializes in wills and estates, with a copy of whatever paperwork she has naming her as beneficiary in hand.

I'm sorry for your family's loss and all the added stress. Hugs.

It is my understanding that it is only some stocks. She also gave some to other entities.  We will be contacting an attorney Monday morning. 

This comes at a bad time, because we intended to leave for a beach vacation Monday. We may still get to go, but DH cancelled the hotel just in case. 

 

 

[Catwoman]

5 minutes ago, math teacher said:

It is my understanding that it is only some stocks. She also gave some to other entities.  We will be contacting an attorney Monday morning. 

This comes at a bad time, because we intended to leave for a beach vacation Monday. We may still get to go, but DH cancelled the hotel just in case. 

 

 

Why can’t you still go on vacation?

[math teacher]

1 minute ago, Catwoman said:

Why can’t you still go on vacation?

She is dependent on us. If we can set up an appointment for Friday, we will go ahead and go. But if they want us to come in sooner, we would need to take her.

[mom2samlibby]

If she is listed as the beneficiary of those, he has no claim to them. The letter is a scare tactic. He's hoping she'll just sign them over. He has no right to them and she does not need to sign them over to him.

I would go on vacation.  The 10 days is a bully tactic too. 

[Arcadia]

6 hours ago, Clemsondana said:

  For ours and theirs, they went something like 'In the event of my death, everything goes to spouse.  If spouse is dead, it then goes to (kids, grandkids, siblings) to be divided (evenly or in specified proportions)'.  

When my husband’s aunt pass, his grandma already had dementia. Luckily his late grandma has no assets to distribute when she passed at a 100 years old. His aunts would definitely have wanted their late sister’s children to get her share if there was any inheritance. My in-laws tend to be money grabbing so I won’t vouch for them.

OP, 

Sorry that this relative is greedy and giving your MIL a hard time.

Edited July 9, 2022 by Arcadia
Autocorrect

[maize]

I don't think your MIL is under any obligation at all to respond within ten days. I wouldn't cancel your vacation plans.

[maize]

According to this, contesting a will rarely results in success:

https://www.hml-law.net/2021/04/contesting-a-will/#:~:text=Research shows that only 0.5,will contests ending up unsuccessful.

I would want to find out who is named as beneficiary in the actual investment account.

 

[happi duck]

If they need to be signed over they sound very much like they are hers.  Otherwise he'd be saying that he was refusing to give them to her.

Is the spouse the executor?  If so she made the bequest to your mom knowing he might outlive her.  

[math teacher]

1 hour ago, happi duck said:

If they need to be signed over they sound very much like they are hers.  Otherwise he'd be saying that he was refusing to give them to her.

Is the spouse the executor?  If so she made the bequest to your mom knowing he might outlive her.  

I don't know who the executor is. They didn't have children together, there are no more sisters. He has a daughter from a previous marriage, but I don't think she would be the executor.

[annandatje]

To know if your mother in law had a case, you need to read will and any living revocable trust the decedent May have established.  How were the stocks titled?  POD, TOD or held in joint account ?  If held jointly, did she file a gift tax return if required?  You will also need to find out if Arkansas has elective share laws for a spouse;  it may hinge upon this.

[Catwoman]

29 minutes ago, annandatje said:

To know if your mother in law had a case, you need to read will and any living revocable trust the decedent May have established.  How were the stocks titled?  POD, TOD or held in joint account ?  If held jointly, did she file a gift tax return if required?  You will also need to find out if Arkansas has elective share laws for a spouse;  it may hinge upon this.

It would seem that if the husband had any right to those stocks, he wouldn’t need to ask the MIL to sign anything over to him, because they would already belong to him. As it is, the MIL is the designated beneficiary, so the stocks belong to her. 

@math teacher — can your MIL contact the broker directly about this? Does your MIL even know how much the stocks are worth? I’m assuming it’s a decent amount if her dh is so desperate to get them. 

If you can contact the broker, they might be able to straighten this out for your MIL without her having to pay for an attorney, as all she should have to do is inform them that she is the beneficiary, and they will transfer the stocks to her. Her sister’s dh need not be involved at all if your MIL was listed with the broker as a beneficiary.

[math teacher]

10 hours ago, Catwoman said:

It would seem that if the husband had any right to those stocks, he wouldn’t need to ask the MIL to sign anything over to him, because they would already belong to him. As it is, the MIL is the designated beneficiary, so the stocks belong to her. 

@math teacher — can your MIL contact the broker directly about this? Does your MIL even know how much the stocks are worth? I’m assuming it’s a decent amount if her dh is so desperate to get them. 

If you can contact the broker, they might be able to straighten this out for your MIL without her having to pay for an attorney, as all she should have to do is inform them that she is the beneficiary, and they will transfer the stocks to her. Her sister’s dh need not be involved at all if your MIL was listed with the broker as a beneficiary.

She doesn't know how much they are worth, nor who the broker is or anything about the stocks at all. Sister passed in February, and MIL is pretty helpless about taking care of business. DH and I have to do almost everything for her. DH has an appointment set up to discuss things with an advisor (I think) week after next. 

[Scarlett]

I was thinking about this.  There are a lot of situations where you can’t cut your spouse out of your will or leave certain things to someone else.  Was her will written by an attorney? If so I would think said attorney would have advised her of what she was asking was legal.  
 

Has there been any conversation with the husband since his wife died? Has your MIL seen the will?  Did she know her sister was leaving her these stocks? 

So many questions. It is difficult to know if she really needs an attorney with the limited info. 
 

Unkess there is a history of very bad blood with this husband I would be inclined to call him up and say, hey dude what is going on?  With no attitude.  
 

If the letter from the attorney is the first conversation about this will and the stocks then I think that is pretty aggressive and rude.  And so arrogant to threaten an elderly woman with ‘$300 an hour attorney fees ‘. 
 

The only time I ever got a letter from am attorney was my xh’s attorney.  She threatened to take me to court if I did not agree to some crazy changes to the custody agreement. I was so angry I thought I would have a heart attack. But what I did was completely ignore it.  About a year later my xh ask me if I had received that letter.  Lol.  I said yes I did but it was so confusing considering it is nothing like what you and I need I just figured she was confused. That was the end of that.  But of course this is different. There is money involved that your MIL needs to collect.  So she can’t just ignore it.  But I hope she will not be frightened by his scare tactics.

Oh one time my step sister was contacted by her aunt wanting my step sister to sign over her claim to their stepsister and step brothers grandmothers inheritance. ( she died without a will so her deceased daughter’s children (my step sister and step brother) were the heirs for their mother’s share.).  My step sister very kindly said, ‘That is our legal share but if you really truly believe it is not then send the paper and I will sign it.’ The aunt did not send anything and eventually my step siblings got their share. It was a small amount.  Less than $5k each. Very helpful to them but not worth fighting over.

Sorry to ramble.  
 

 

Edited July 10, 2022 by Scarlett

[lauraw4321]

Caveat that I’m not your lawyer. Do you know if MIL was named beneficiary of the stock like through an IRA or was she named only through the will? If the former, then likely the husband has no claim, as the stock passed outside of her estate. If the latter, and the stock comprised a substantial portion of her estate then the husband may have a valid claim. I know in AL, you cannot disinherit your spouse in your will. 

[Tree Frog]

Who notified MIL she was the beneficiary of the stocks? Can she go back to that person/company to ask questions and gain further info? Or was it her BIL's attorney's threatening letter that notified her?

[freesia]

5 minutes ago, Tree Frog said:

Who notified MIL she was the beneficiary of the stocks? Can she go back to that person/company to ask questions and gain further info? Or was it her BIL's attorney's threatening letter that notified her?

That’s what I’m confused about. The executor should have given her all the information she says she doesn’t have. 

[annandatje]

It seems that Arkansas does indeed have elective spousal share law that can override provisions of wills and living trusts.  I urge you to find an attorney who specializes in estates.  Likely will run more than the 250-300 per hour unless you are in a very small town.  Please do not seek legal advice from a stockbroker or even from a registered financial advisor.   While they have elementary knowledge of estate administration, they generally do NOT have a strong knowledge of state law.  Athis point, there is not enough information to determine if husband attempting to hoodwink heirs or if he is rightfully claiming what he is due under state law.  

[QueenCat]

Whatever you do (or have mom do), don't get legal counsel from the attorney who contacted you. Get it from another attorney, who is licensed in the state where the decedent lived.

[math teacher]

6 hours ago, Scarlett said:

I was thinking about this.  There are a lot of situations where you can’t cut your spouse out of your will or leave certain things to someone else.  Was her will written by an attorney? If so I would think said attorney would have advised her of what she was asking was legal.  
 

Has there been any conversation with the husband since his wife died? Has your MIL seen the will?  Did she know her sister was leaving her these stocks? 

So many questions. It is difficult to know if she really needs an attorney with the limited info. 
 

Unkess there is a history of very bad blood with this husband I would be inclined to call him up and say, hey dude what is going on?  With no attitude.  
 

If the letter from the attorney is the first conversation about this will and the stocks then I think that is pretty aggressive and rude.  And so arrogant to threaten an elderly woman with ‘$300 an hour attorney fees ‘. 
 

The only time I ever got a letter from am attorney was my xh’s attorney.  She threatened to take me to court if I did not agree to some crazy changes to the custody agreement. I was so angry I thought I would have a heart attack. But what I did was completely ignore it.  About a year later my xh ask me if I had received that letter.  Lol.  I said yes I did but it was so confusing considering it is nothing like what you and I need I just figured she was confused. That was the end of that.  But of course this is different. There is money involved that your MIL needs to collect.  So she can’t just ignore it.  But I hope she will not be frightened by his scare tactics.

Oh one time my step sister was contacted by her aunt wanting my step sister to sign over her claim to their stepsister and step brothers grandmothers inheritance. ( she died without a will so her deceased daughter’s children (my step sister and step brother) were the heirs for their mother’s share.).  My step sister very kindly said, ‘That is our legal share but if you really truly believe it is not then send the paper and I will sign it.’ The aunt did not send anything and eventually my step siblings got their share. It was a small amount.  Less than $5k each. Very helpful to them but not worth fighting over.

Sorry to ramble.  
 

 

I believe it was a will kit that she filled out and had notarized. She was seeing a Financial Advisor, but I don't think she saw an attorney. 

Husband started asking MIL to sign papers not long after his wife died, when he and MIL were still friends. I really believe she wanted to give him some of the money at first, but since he has threatened her with a lawsuit, she isn't interested in that.

DH is MIL's only heir, so this money or whatever will be our burden one day. I can see how Husband's daughter from a previous marriage might give us grief over it. I surely hope not.

[math teacher]

21 minutes ago, QueenCat said:

Whatever you do (or have mom do), don't get legal counsel from the attorney who contacted you. Get it from another attorney, who is licensed in the state where the decedent lived.

Yes, that is what we are planning to do.

[math teacher]

4 hours ago, freesia said:

That’s what I’m confused about. The executor should have given her all the information she says she doesn’t have. 

Husband is the one who told her about it. I heard him make the statement that his wife had left him the least amount of all. 

[math teacher]

6 hours ago, lauraw4321 said:

Caveat that I’m not your lawyer. Do you know if MIL was named beneficiary of the stock like through an IRA or was she named only through the will? If the former, then likely the husband has no claim, as the stock passed outside of her estate. If the latter, and the stock comprised a substantial portion of her estate then the husband may have a valid claim. I know in AL, you cannot disinherit your spouse in your will. 

We do not know that yet. She has just been hearing from Husband from time to time requesting her to sign, and then Friday she received the letter from his attorney. 

[lauraw4321]

45 minutes ago, math teacher said:

We do not know that yet. She has just been hearing from Husband from time to time requesting her to sign, and then Friday she received the letter from his attorney. 

This will all go much smoother with an attorney representing MIL. 

[math teacher]

Which should have been done 3 months ago instead of now!! 😅

[Catwoman]

49 minutes ago, math teacher said:

We do not know that yet. She has just been hearing from Husband from time to time requesting her to sign, and then Friday she received the letter from his attorney. 

She didn’t sign anything, though, right?

[Catwoman]

52 minutes ago, math teacher said:

Husband is the one who told her about it. I heard him make the statement that his wife had left him the least amount of all. 

Maybe she wasn’t as fond of him as he thought she was! 😉 

[math teacher]

32 minutes ago, Catwoman said:

She didn’t sign anything, though, right?

Correct

[math teacher]

31 minutes ago, Catwoman said:

Maybe she wasn’t as fond of him as he thought she was! 😉 

MIL has said she was getting ready to ask the Financial Advisor about divorce.

[Scarlett]

1 hour ago, math teacher said:

I believe it was a will kit that she filled out and had notarized. She was seeing a Financial Advisor, but I don't think she saw an attorney. 

Husband started asking MIL to sign papers not long after his wife died, when he and MIL were still friends. I really believe she wanted to give him some of the money at first, but since he has threatened her with a lawsuit, she isn't interested in that.

DH is MIL's only heir, so this money or whatever will be our burden one day. I can see how Husband's daughter from a previous marriage might give us grief over it. I surely hope not.

The reason my step siblings were the legal heirs is because 1)their mother had died and 2)their maternal grandmother died without a Will. 

So yes if your Dh precedes his mother in death and she (his mother) has no will, his children would get his share ( in AR that is). 
I am not  an attorney. 
 

Edited July 10, 2022 by Scarlett

[maize]

2 hours ago, math teacher said:

MIL has said she was getting ready to ask the Financial Advisor about divorce.

It sounds like not leaving everything to her husband was very intentional and didn't have anything to do with assuming he would die first.

 

[Catwoman]

3 hours ago, math teacher said:

MIL has said she was getting ready to ask the Financial Advisor about divorce.

 

52 minutes ago, maize said:

It sounds like not leaving everything to her husband was very intentional and didn't have anything to do with assuming he would die first.

 

I agree with maize, and it has definitely convinced me that your MIL should make sure she gets every last dime her sister wanted her to have! 

I'll bet the husband knows that those stocks weren't intended for him, but he's hoping your MIL will sign them over to him before she realizes the marriage was on the skids. (He probably doesn't know that his wife said anything to your MIL about the problems between him and his wife, or at least he's hoping she doesn't know.)

He sounds like a real jerk, trying to threaten and intimidate your MIL, and I'm so glad she has you and your dh to help her and stand up for her.

[BusyMom5]

Hugs, so sorry you are having to deal with all of this!  Do you know the financial advisor?  If so, call up and ask some questions. You need to know how the stocks were issued (TOD, in just her name, etc).  Can you get a copy of the will?  You will need that with you as well.  Try to gather all the info you can before seeing your advisor/lawyer.  I would not just sign them over- that was not her will.  Get a lawyer, get all the info, then decide the best path forward.  Right now, too hard to tell.  

Also, were the stocks actually turned over to MIL?  What are they asking her to sign?  When FIL passed, all joint stocks were split, and his half reverted to the new cost basis as of his date of death, and was reassigned to MILz name.   She did not have to do anything besides send in the death certificate,  the brokerage did it all. 

Stocks- when you buy them, that original cost is your cost basis.  If the price goes up and you sell, you owe taxes on that money (Sell price minus cost basis equals profit you owe on).  If the price goes down and you sell, you can take the loss off on your taxes.  If you die, that stock goes to someone else, the cost basis is reset for the new owner- no one pays taxes on the gain or loss.  If your MIL was legally assigned these stocks, they have a new cost basis.   Depending on the stock, she may owe taxes if she sells them or have a net loss.   They are legal property, just like land.  She can't just "sign it over" to him without looking at her financial obligations and being sure she does it legally.   Even assuming she DID want to give them to him, I'd still recommend she get a lawyer and do it properly.